The American Wind Energy Association published results for last year’s spending on wind energy. The US spent $16.4B on new wind tubines and installed 8500 megawatts of generating capacity. That’s $1.93 million dollars per megawatt of capacity. That’s a lot of money. Especially when a megawatt of capacity of wind energy may only produce 300kW of actual power based on the amount of wind that can be harvested.
The efficiency rating of a wind generator is not related to the equipment, but rather to the average wind speed and number of hours out of a year’s time that the system is generating power. So this number can vary quite a bit, and of course, the generated electricity varies with the wind. So a lot of effort is put into the site survey to determine if a particular location can generate enough power to pay back the cost of the equipment.
At 30% efficiency the average power generated is 300kW. This is enough electricity to power 231 homes if the homes are all using about 1300 kWh per month. Personally, I have not been able to get my power usage under 200kWh per month, so it might be many less homes in actual practice, but you get the idea. If you are paying 11.5 cents per kilowatt hour that’s only $149 per month in electricity. So the revenue for 1 megawatt of capacity is $34,535 per month. And since a wind farm has operating costs, usually estimated at 10%, the revenue minus operating cost is $31,082. To pay off that $1.93 million invested will take 62 months. Sure, it will go a lot quicker if the electricity rate is high like in California. But it looks like everyone is making money at this alternative energy stuff except the consumer.
Texas has very low energy costs to begin with, and solar power has slightly lower net efficiency than wind power due to the number of hours of daylight, the number of days of sunshine, etc. So the local utility has begun suggesting to customers that because of expensive investments in wind and solar alternative energy systems, that we (the customers) will have to pay increasing rates for power to “help shoulder the costs”. Really? I thought all this alternative energy stuff was going to lower our costs.
I’m not a financial genius, but I can tell there’s a problem. Especially when no one in the alternative energy industry ever talks about return on investment. We have to focus on technology that has better financial performance. And I think it’s out there, and my company is working on some of the solutions. We’re just stuck behind the slow moving giants of the industry who are dominating the landscape. It’s time for some of that Yankee Ingenuity to come to the forefront.